Factors Affecting Apple's Share Price
Anthony Fisher
This research aims to explore what variables effect the common stock share price of Apple Inc (AAPL). The variables being used are closing price, volume, NASDAQ composite (IXIC), dividend amount, news, and total return. A multiple linear regression is run to determine what variables are significant.
Fall
12
Variables Effecting AAPL
08
Fall
Ohio Wesleyan University
Introduction There are many factors that determine a common stock’s share price. To some, it is pure speculation and confidence within the market, to others this a multitude of factors that determine a common stock’s share price that is traded on many exchanges around the world. According to Sunde and Sanderson, these variables that control a common stock’s share price are corporate earnings, management, lawsuits, mergers and takeovers, market liquidity and stability, availability of substitutes, government policy, macroeconomic fundamentals, investor sentiments, and analyst reports (Sunde and Sanderson 191). Although it is undetermined to a finite measurement what exactly will sway a common stock’s share price, these are possible variables that can and have created price movements within a common stock’s price. Apple Inc (AAPL) is no exception to this rule. Although it is a very large and powerful firm, it has had its fair share of price spikes and troughs. Recently, with the release of the newest iPhone model, Apple came up short on estimates by selling only 5million units of the iPhone 5 (Satariano). This bad news prompted many investors to sell their holdings; therefore the price of Apple plummeted. However, this cannot be the only reason for Apple creating a trough in its common stock share price, there must be more. The analysis that this study aims to explore is how Apple’s common stock share price is effected. Since there are no rules or regulations as to how a common stock price should fluctuate based upon outlying variables, this research will focus on a set of
This research aims to explore what variables effect the common stock share price of Apple Inc (AAPL). The variables being used are closing price, volume, NASDAQ composite (IXIC), dividend amount, news, and total return. A multiple linear regression is run to determine what variables are significant.
Fall
12
Variables Effecting AAPL
08
Fall
Ohio Wesleyan University
Introduction There are many factors that determine a common stock’s share price. To some, it is pure speculation and confidence within the market, to others this a multitude of factors that determine a common stock’s share price that is traded on many exchanges around the world. According to Sunde and Sanderson, these variables that control a common stock’s share price are corporate earnings, management, lawsuits, mergers and takeovers, market liquidity and stability, availability of substitutes, government policy, macroeconomic fundamentals, investor sentiments, and analyst reports (Sunde and Sanderson 191). Although it is undetermined to a finite measurement what exactly will sway a common stock’s share price, these are possible variables that can and have created price movements within a common stock’s price. Apple Inc (AAPL) is no exception to this rule. Although it is a very large and powerful firm, it has had its fair share of price spikes and troughs. Recently, with the release of the newest iPhone model, Apple came up short on estimates by selling only 5million units of the iPhone 5 (Satariano). This bad news prompted many investors to sell their holdings; therefore the price of Apple plummeted. However, this cannot be the only reason for Apple creating a trough in its common stock share price, there must be more. The analysis that this study aims to explore is how Apple’s common stock share price is effected. Since there are no rules or regulations as to how a common stock price should fluctuate based upon outlying variables, this research will focus on a set of
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